Appraisal myths debunked

It is enforced by the government that a real estate appraiser needs to be state-licensed to perform appraisal reports for federally-related home sales in Louisiana. Also by law, you have the ability to request a copy of the finished appraisal report from your lender. Contact our professional staff if you have any questions about the appraisal procedure.

Myth: Market value must be similar to the assessed value of the property.

Fact: It is possible that Louisiana, like most states, validates the suggestion that the assessed value equates to the market value; however, this is sometimes the exception rather than the rule. Examples include when interior reconstruction has happened and the assessor is unaware of the improvements, or when houses in the area have not been reassessed for an extended time.

Myth: The appraised value of a house will be different depending upon if the appraisal is ordered for the buyer or the seller.

Fact: The appraiser has no personal interest in the result of the appraisal and should conduct services with independence, objectivity and impartiality - no matter for whom the appraisal is written.

Myth: Market value will equal replacement cost.

Fact: Market value is arrived at through what a willing buyer would likely pay a willing seller for a certain property, with neither being under pressure to buy or sell. Replacement cost is the dollar amount needed to rebuild a house in-kind.

Myth: Appraisers use a calculation, like a certain price per square foot, to conclude the value of a property.

Fact: An appraisal report is a collection of information concluded from the property's size, location, proximity to some facilities, the condition of the home and the price of recent comparable sales. You can count on Crescent Appraisal Group, Inc.'s appraisers to be ethical in assessing this information.

Myth: As houses increase their worth by a certain percentage - in a robust economic state - the homes around the appreciating properties are figured to appreciate by the same amount.

Fact: Any value at which an appraiser arrives concerning a certain home is always personalized, based on certain factors derived from the data of comparable houses and other specifications within the home itself. It makes no difference whether the economy is strong or poor.

Myth: You can usually find what a property is worth simply by looking at the exterior.

Fact: To conclude an accurate value beyond all doubt, an appraiser must assess the home on a variety of factors based on area, condition, improvements, amenities, and market trends. An outside-only inspection certainly can't provide all of the data required.

Myth: Since you're the one funding for the appraisal report when applying for your loan to purchase or refinance real estate, you own the produced appraisal.

Fact: Unless a lending agency releases its interest in the document, it is legally owned by the lending agency that ordered the appraisal. However, home buyers must be given a copy of the appraisal upon written request, because of the Equal Credit Opportunity Act.

Myth: There's no reason for consumers to even worry about what the appraisal report contains so long as their lending institution is satisfied.

Fact: It is a very good idea for home buyers to read a copy of their report so that they can verify the accuracy of the report, in case there is a need to question its accuracy. Remember, this is probably the most expensive and important investment a consumer will ever make. An appraisal can double as a record for the future, since it contains a great deal of data - including, but certainly not limited to the legal and physical description of the property, square footage measurements, list of comparable properties in the neighborhood, neighborhood description and a narrative of current real-estate activity and/or market trends in the vicinity.